Mastering life-cycle loyalty: Service with a smile (and a strategy)
Insights from PwC’s Customer Loyalty Surveys
When was the last time you called customer service just to tell them you loved a product? Or asked to speak to a manager specifically to compliment an employee or experience? Chances are these moments are few and far between. If you call the help desk, more likely you’ve already experienced a problem.
Why, then, do so many business leaders lean on customer service functions to build loyalty? In our 2023 PwC Customer Loyalty Executive Survey, 39% of executives told us they consider loyalty as falling under the domain of customer service — more than double the next most common response option. But customer service isn’t primarily about building loyalty — it’s service recovery.
By meeting your customers with loyalty across their experience journey, you can be more proactive than mere problem-solving, unlocking real value for your company. Think of loyalty as a growth engine, driving sustained customer relationships, from top-of-the-funnel all the way through repurchase, including service recovery.
“Loyalty is definitely not done in a vacuum with one team. It is truly cross-functional. We are working hand in hand with our creative team, product team, business intelligence, marketing, analytics, and finance and accounting. So it is a full team effort.”
Most loyalty programs are managed by customer service functions
Source: PwC Customer Loyalty Executive Survey 2023: base of 410
Loyalty is the journey, not the destination
Executives and consumers strongly disagree on when brand loyalty is won. Executives primarily think it happens when users receive good customer service (25% of respondents), followed closely by when customers try and like the product in question (23%). But only 11% of consumers say good customer service won their loyalty — while nearly half (46%) pointed to the product.
We believe that many businesses may be missing out on opportunities to drive loyalty by focusing their efforts too narrowly. To really drive growth, loyalty functions need to take a more proactive approach, connect with consumers earlier in the customer journey and sustain that connection through the sale for the full product life cycle. Is your customer service function really the only group that can expand your loyalty?
Executives fail to fully meet customers where they are
Source: PwC Customer Loyalty Executive Survey 2023: base of 410
Q: Continue to think about your experiences with [brand] (selected from previous question). When did you decide you would keep using or buying from that brand?
Source: PwC Customer Loyalty Survey 2022: base of 4,036
Where in the customer journey does your business model thrive?
Not all loyalty models are created equal, and that’s OK. Different industries, products and services all have different allures that drive repeat business. Are you concentrating your loyalty efforts where they’re primed to win? Or are you fighting an uphill battle in the wrong market?
When we asked consumers to think of a brand they regularly use or purchase, 84% were able to name a company off the top of their heads. Of those companies, half specialize in consumer goods or other retail. For these companies plus grocery stores — the kind of shopping trips many of us take frequently — key loyalty drivers were good value and consistent, high-quality products. But among technology companies, quality is more important than price, and when it comes to dining and travel, loyalty programs for repeat customers are the big draw.
Loyalty is earned at different points in the customer journey in different industries
Q: You mentioned [brand] (selected from previous question) as a company/brand you regularly use or buy from. What are the top reasons you keep buying or using [brand]?
Source: PwC Customer Loyalty Survey 2022: base of 4,036
What you can do
- Think of loyalty as a growth engine. Building and maintaining a customer’s loyalty should help drive your customer experience from the moment your customer considers your product or service all the way through service, support and repeat purchases.
- Pick the moments that matter. From the second consumers find you in a search engine through the full product life cycle, focus on customer attraction, not just retention. If your business has a high rate of repeat customers, make sure you’re offering reasons to keep them coming back for the same experience. If you sell a variety of products, make it easy and fun to discover new ones.
- Treat employee experience as customer experience. Engaging your employees engages customers — after all, good customer service experiences are still valuable loyalty drivers. Determine which model of customer centricity is most effective for your business, then consider how you can turn your employees to champions for your cause.
About the survey
PwC surveyed 410 executives across a range of consumer-facing companies between October 15 and November 22, 2022. Respondents in the online survey included C-suite officers, business owners, upper management, directors and corporate board members in the US. Roughly two-thirds (64%) of respondents have sole responsibility for business decisions on customer loyalty or customer retention, and one-third (36%) share influence with others regarding business decisions on loyalty or retention.
The PwC Customer Loyalty Executive Survey 2023 follows the PwC Customer Loyalty Survey of 4,036 consumers in the US in May 2022. Respondents in that online survey were adults 18 and older, with demographic weighting to achieve census representation on age, gender, race, US region, income, employment status and marital status.
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